Below:

A masked soldier stands guard over what Mexican authorities described as one of the biggest seizures of weapons bound for drug cartels in this Nov. 7, 2008, photo. Some 288 assault rifles, 500,000 rounds of ammunition, numerous grenades and several .50-caliber rifles were in the stockpile.

WASHINGTON — A major Justice Department program aimed at intercepting the flow of U.S. weapons to Mexico’s drug cartels is misfiring due to bureaucratic turf battles and a failure to share critical intelligence about illegal firearms purchases, according to an internal department report.

The draft report by the Justice Department’s Office of Inspector General, obtained by NBC News, is a scathing indictment of Project Gunrunner, a law enforcement initiative run by the department’s Bureau of Alcohol, Tobacco, Firearms and Explosives.

The report also seems to counter statements made by ATF's own officials.

On Friday, Deputy Director Kenneth Melson touted the program's success when he announced that a temporary surge of agents in Arizona under the program had led to seizures of 1,300 illegal weapons and 71,000 rounds of ammunition destined for Mexico’s cartels. Thanks to $37.5 million in new funding from Congress, Melson announced that ATF was expanding Gunrunner to target illegal gun traffickers in seven additional cities.

'Significant weaknesses'The inspector general’s report concludes there are “significant weaknesses” to Gunrunner that “undermine its effectiveness.” In particular, the report found that ATF was failing to share intelligence about illegal gun trafficking with other U.S. law enforcement agencies, particularly the Department of Homeland Security’s Immigration and Customs Enforcement (ICE).

ATF and ICE “do not work effectively” together, “rarely conduct joint investigations” or even notify each other about what cases they are working on — despite a high level Justice directive last year that they do so, the report states. The result is that intelligence about gun trafficking activities that could potentially lead to arrests and smuggling prosecutions at the borders never gets passed along, it said.

The report comes amid mounting evidence that the illegal trafficking of U.S. weapons across the southwest border is growing at an alarming rate.

Mexican president Felipe Calderon and other Mexican officials have repeatedly complained that the U.S.'s failure to crackdown on the illegal weapons flow, much of it stemming from gun stores along the southwest border, fuels the drug-related violence that is estimated to have killed 30,000 people in the past four years. But critics say President Barack Obama and Congress have balked at taking tougher measures, such as banning the sale of semi-automatic assault rifles, for fear of clashing with the gun lobby.

One recently released study by the Woodrow Wilson Center and the Trans-Border Institute at the University of San Diego found that out of 75,000 firearms confiscated by Mexican authorities in the last three years, 60,000 of them — or 80 percent — had come from the U.S. The most common weapons were semi-automatic assault rifles — a Romanian made version of the AK-47 and versions of the Bushmaster AR-15.

Most popular

'The system ... is broken'
The resistance to sharing information about weapons trafficking even applies within ATF itself, the inspector general’s report found.

As part of Gunrunner, the organization has been trying to beef up a small and undermanned Mexico City office, which it says is backlogged with 200 requests from Mexican officials for information about the U.S. origin of guns seized in that country and the individuals suspected of buying them. But ATF officials in Mexico complained to the inspector general’s investigators that they get little help from their counterparts at Southwest border field divisions at ATF.

“The Southwest border field divisions don’t talk to each other,” one ATF official in Mexico City is quoted as saying in the report. “There is no exchange of information. Right now, the system (to exchange information) is broken.”

The report identifies multiple other problems with Gunrunner, including a lack of effective cooperation with Mexican law enforcement officials and the distribution of “stale” leads about illegal gun buying that are of little use to investigators. The report also faults a timid investigative strategy by ATF that concentrates on low level “straw purchasers” of illegal firearms rather than high level weapons trafficking organizations.

About 70 percent of Gunrunner cases involve low level single defendants, most of whom are hired to buy small numbers of firearms at U.S. gun stores, the report states. ATF agents in one field division “told us they felt discouraged from conducting complex conspiracy cases” involving higher level gun traffickers. Asked for an explanation, the ATF official in charge of that field division “acknowledged that he preferred his agents to initiate cases that could be completed within one month rather than involve surveillance, wiretaps and other investigative methods typical of complex conspiracy cases,” the report states.

An ATF spokesman in Washington said the agency was not prepared to respond to the criticisms in the report, saying the document was only a “working draft.” One senior ATF official, who spoke on condition of anonymity, said that many of the problems identified in the report stem from a lack of funding from Congress and weak U.S. gun laws, including the absence of a specific statute making weapons trafficking a federal crime.

Rather than tightening U.S. gun laws, Congress is now considering a bill — the ATF “Reform and Modernization Act,” backed by the National Rifle Association — that would weaken ATF’s ability to regulate rogue firearms dealers who either look the other way or are complicit when straw buyers working for the cartels purchase weapons, the official said.

The report may end up focusing attention on what critics, especially gun control groups, charge has been a major shortcoming of the Obama administration: the president's failure to nominate a director for ATF, despite having been in office more than 18 months, apparently because of concerns that any candidate would rile the ever potent gun lobby.

Deputy Director Melson has been serving as the de facto chief of ATF since last year, but current and former agency officials have complained that the absence of a presidentially nominated director has left the agency with little clout within the administration and unable to make major decisions that could make it more effective in cracking down on the illegal weapons trade.

A tattooed man stands on a hill overlooking Ciudad Juarez, Mexico, one of the most dangerous cities in the world, on Dec. 20, 2008.
Cartels have launched a wave of violence against the government of President Felipe Calderon since it began a crackdown on organized crime in 2006. According to the attorney general’s office there were 5,370 drug-related homicides in the year to Dec. 2, 2008. That is double the 2007 number. Juarez alone saw an estimated 1,600 such slayings. And the deaths can be horrific – victims have been tortured, beheaded or dissolved in acid.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

Inside the car where Marisela Granados de Molinar was killed on Dec. 3 alongside her boss, Jesus Martin Huerta Hiedra, a deputy prosecutor in the Mexican city of Juarez.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

Federal police search cars at an impromptu checkpoint near the U.S. border on Nov. 10, 2008.
In the late 1980s the United States stemmed the flow of cocaine from South America through the traditional trade routes in the Caribbean. Looking for alternate ways into the U.S., South American cartels began to run drugs through Central America and Mexico, and now the vast majority of illegal drugs flow through this corridor. Facing the recent slew of deaths and corruption scandals among all levels of the police, the government has deployed 45,000 soldiers to fight the cartels as well.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

Missing person signs litter the walls of local police stations in Juarez.
Kidnapping is integral to the drug-running business and the general lawlessness accompanying it. Before the latest surge in drug violence, Juarez was infamous for another gruesome string of crimes – the kidnapping and murder of young women. There have been 508 such incidents since 1993, according to the state government. When the bodies do show up, many have been raped and mutilated. Many believe that most of these deaths are related to gang initiation rituals.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

El Diario newspaper's Armando Rodriquez was murdered outside his home while warming up his car on Nov. 13, 2008. The 40-year-old crime reporter was killed in front of his 8-year-old daughter who he was about to drive to school.
Mexico is one of the most dangerous places in the world for journalists, according to the Committee to Protect Journalists. Since 2000, 25 have been killed there. In addition, seven journalists have disappeared since 2005. Many reporters refuse to put their bylines on stories, and many newspapers have stopped covering the drug gangs altogether.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

The body of El Diario's Rodriquez -- killed in his car outside his house while his family watched in November 2008 -- is taken away in a body bag by an ambulance.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

A U.S. official stands beside a recently discovered cache of drugs on the El Paso-Ciudad Juarez border crossing.
In December, the United States delivered $197 million to Mexico, the first stage of a $400-million package to buy high-tech surveillance aircraft, airport inspection equipment, and case-tracking software to help police share intelligence.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

Men and boys shoot heroin in a "picadero," or shooting gallery, in Ciudad Juarez on the banks of the Rio Grande, just across from the United States. Thousands of picaderos, some serving as many as 100 customers a day, are said to exist in Juarez alone.
Drug use and addiction among Mexicans has exploded recently, with the number of known addicts almost doubling to 307,000 in six years. Most experts assume these numbers dramatically undercount the problem.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

Patrons and workers mingle at Hollywood strip club in downtown Juarez. With American sex tourism on the decline due to the dramatic increase in murder and violence, the few remaining strip clubs have become common hangouts for narcotics traffickers, or ‘narcos.’
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

A man walks in front of 24-hour funeral parlor. The death industry is booming in Juarez where an estimated 1,600 people were murdered in 2008.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

Neighbors and family of slain Alberto Rodriquez, 28, watch and cry as the authorities descend on the crime scene. Rodriguez was killed in his car outside his house while his family watched.
(Shaul Schwarz)
ShareBack to slideshow navigation

A bus carrying women and children drives by the site where David Rodriguez Gardea, 42, and Antonio Bustillos Fierro, 38, were gunned down on Nov. 12, 2008. The agents had led an investigation resulting in the arrests of gang members suspected in dozens of murders.
The cartels are killing police officers at an unprecedented rate, especially at the border. Gangs have been breaking into police radio frequencies to issue death threats. "You're next, bastard ... We're going to get you," an unidentified drug gang member said over the police radio in the city of Tijuana after naming a policeman, Reuters reported recently.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

A U.S. border patrol officer stands behind bullet-scared bullet-proof glass on the El Paso-Ciudad Juarez border. Although border agents do not get shot at often they are self-described "sitting ducks." The cartels and drug traffickers send messages of terror through such examples.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation

The casket of David Miranda Ramirez, 36, is carried by fellow police at his funeral on Nov. 13, 2008.
An estimated 50 of Ciudad Juarez’s police officers were killed in 2008 in incidents blamed on drug gangs. Many officers have quit out of fear for their lives, often after their names have appeared on hit lists left in public. While some police have been killed, others are being lured into cooperating with the cartels. Theses gangs have “enormous economic power, and behind that, enormous power to corrupt and intimidate,” says Attorney General Eduardo Medina-Mora.
(Shaul Schwarz / Reportage by Getty Images)
ShareBack to slideshow navigation